Abstract

This second working paper within the series of reports on the ongoing activities in IIASA's International Gas Study presents some test applications of the GATE-I model (Gas Trade, Integrated Version). The general outline of this model can be found in the report, "Model of European Gas Production, Trade and Consumption". The GATE-I model has been applied to demonstrate the feasibility of modeling natural gas scenarios and the corresponding gas trade among the European subregions.

Altogether four scenarios were developed: a base case that provides an initial test of the prospects for natural gas in future energy strategies for the European continent and indicates the trade links needed to meet expected demand; a scenario in which different export price-to-quantity relations are assumed for the gas exporting regions of the Soviet Union and North Africa; a supply security scenario that incorporates some gas import dependency policy considerations; and a scenario in which environmental aspects are considered in terms of the costs of meeting SO2 emission reduction requirements for enhanced natural gas consumption.

In sum, given the simplification needed to keep GATE-I relatively compact and computationally fast, the main objectives of the exercise have been fully met. The quantitative results of applying the model to the analysis of gas prospects for the above regions should not be considered conclusive, but are suggestive of possible trends with respect to gas use in these regions. The preliminary analysis is currently being followed up with more detailed investigations.